AEC Fights Natural Gas Proposal in Western Pennsylvania

It is said that experience is the best teacher, and the American Energy Coalition gained some valuable experience when it responded to a proposal by UGI, a natural gas utility in Pennsylvania. The utility offered to extend a gas main into the borough of Orwigsburg if a sufficient number of homeowners committed to convert to natural gas. This offer by UGI dates back to January 2014. At that time, the AEC partnered with the Berks Schuylkill Oilheat Association to inform homeowners of the “True Cost to Convert” using an Every Door Direct Mail Campaign (EDDM), while the borough was helping UGI to inform homeowners of the offer to bring a new gas main to service the area.

The EDDM campaign took advantage of a product offered by the U.S. Postal Service that offers a very reasonably priced post card delivery service to a specific geographic area. Using the EDDM service you can specify a zip code or zip codes, or you can specify a location (address) and a radius around that location to define your target area, and the Post Office will deliver your post card to every address within the defined area. In the case of the UGI/Orwigsburg proposal, the target area consisted of about 3,500 homes. To date, UGI has not moved forward with its offer to extend the gas main into Orwigsburg. AEC would like to think that the EDDM campaign and the efforts of the BSOHA combined to blunt UGI’s offer, but we acknowledge other factors may have also contributed to UGI’s decision. The bottom line here is that the gas main has not been extended; the homes in Orwigsburg continue to be heated with fuel oil. That experience taught us well for what now confronts us.

In January, a new, similar threat materialized in western Pennsylvania when Peoples Gas offered to extend a gas main into East Taylor Township to service 210 homes, but only if 125 of those homeowners committed to use natural gas in some form. Ted Harris, the recently hired director of marketing for the Pennsylvania Petroleum Association (PPA) contacted AEC for help in combating this new threat. Encouraged by the success of the BSOHA/Orwigsburg EDDM campaign, we have deployed a similar campaign in East Taylor Township.

The design of this new EDDM post card borrows the design from another post card campaign that the AEC carried out in partnership with the Better Home Heat Council of Lehigh Valley in 2015 to draw attention to interruptible gas services. Interruptibles are a huge problem in major metropolitan areas and put exceptional demands on the oil heat industry during very cold periods when the industry is already stretched to the limits. They drain resources while putting upward pressures on the price of heating oil beyond normal market supply and demand metrics.

To fend off the proposal by Peoples Gas, we focused on the “Cost to Convert” and the “Premium Price” that Peoples Gas is offering to homeowners. Specifically, the cost of the natural gas is estimated to be, potentially, up to 200% of what other Pennsylvania homeowners would normally pay for the same natural gas.

A decision is pending on whether to present a webinar as part of the campaign. The webinar would educate East Taylor Township’s local heating oil dealers on where to find helpful information on the AEC website. That information is useful when fielding calls from homeowners who have received postcards.

The AEC Website is a treasure trove of information regarding the “Cost to Convert,” “Pipeline Safety Issues,” Environmental Issues,” increased production in the U.S. and other pro-oil heat messaging along with issues relevant to the disadvantages of converting to natural gas. The proposed webinar would be designed to educate customer service representatives and other frontline dealer personnel as to where to direct homeowners to find answers to their questions that are likely to arise from the EDDM postcard. Due to the sheer volume of data available on the AEC website, a tutorial could be very useful, especially in this instance.

And keep your fingers crossed that AEC and PPA can stop this new Peoples Gas proposal. Admittedly it is a small number of homes, just 210, but every one of those oil-heated accounts saved is a victory for the oil heat industry.